The Difference Between Foundry Enterprises And Brand Enterprises Under Soaring Cotton Prices

Foundry companies complain incessantly.

Cotton prices rise after September.

Cotton prices continue to soar, so that many clothing and textile enterprises in Xiamen, especially foundry enterprises complain.

Reporters learned from the Xiamen textile and clothing chamber yesterday, although the 128 members of the chamber of Commerce had only 5 large textile enterprises, and only one of Xiamen's main textile materials was cotton.

Other major producers are mainly garments, and seldom purchase cotton directly. However, the purchase price of semi-finished products such as cotton yarn is driven by the price of cotton, which also makes the enterprises feel the cost pressure obviously.

"The profit of the foundry enterprise is very low, and the cost of raw materials rises a little bit, which has a great impact on the profits of enterprises."

An export garment manufacturer in Xiamen, who specializes in foundry, said that the price of cotton has gone up so that the cost of wages and water and electricity is also rising. Only a few points have been eaten up.

Now, some people are trying hard to lose money by biting their teeth.

"We really didn't dare to take the orders recently. Some of the books that were too large and too thin were simply not answered."

Mr. Zhou, head of a textile enterprise in Xiamen, said that a batch of fabrics ordered last month will be delivered next month, but the price of cotton yarn has gone up again, and now the goods must lose money.

Brand companies say nothing.

In contrast, those brand clothing enterprises in Xiamen do not feel much.

"Cotton prices have little impact on brand clothing."

Wang Shaoguang, chairman of Xiamen Hai Shi dress, told reporters: for those famous clothing brands, the retail price is at least 5 times that of all production costs; even for ordinary clothing brands, the retail price is more than 3-4 times the production cost.

"For example, a three hundred or four hundred yuan jeans will cost more than ten yuan and will not have much impact on the enterprise.

According to the insiders, high-end clothing is brand strategy. Their high value-added is mainly reflected in the design, research and development, promotion and cultural connotation of clothing styles. The proportion of raw materials in the whole clothing cost is relatively low, and the impact of cost changes is relatively small.

"Relative to the rise of raw materials, the sharp rise in human resources costs is the main reason for the increase in production costs of local garment processing enterprises."